North Sea oil output falls as gas prices rise amid Middle East conflict

Major oil companies including ExxonMobil, Chevron, Shell, TotalEnergies and BP are withdrawing from the North Sea as production becomes increasingly costly and reserves dwindle. The Brent field, the namesake of the benchmark, was shut in 2021 and remaining platforms have been moved onshore, signalling a possible end to North Sea oil extraction.

The retreat coincides with a surge in oil prices driven by the US‑Iran conflict, boosting profits for the remaining multinationals. At the same time, European gas prices have jumped sharply, with LNG contracts on the Dutch TTF rising more than 75% year‑to‑date. Storage levels sit at just 52.5% of capacity, well below the 80% target for winter. Equinor CEO Anders Opedal warned that Europe may not meet the storage goal without steep price increases. Disruptions in the Middle East, including Qatar’s halt of LNG exports after an Iranian drone strike, have tightened supply, while the EU has imposed an import ban on Russian LNG from 1 January and will prohibit pipeline gas from the region through 2027.